- You (or an individual authorized by You) should sign the endorsement
- It should be attested by at least one witness
- It should mention that you want to assign your policy and the reason for assigning your policy
- The details of the assignee
- The terms on which the assignment is made
Whenever you assign your policy, you need to send a notice of such assignment to the insurer. An assignment will only be operative against the insurer if the following conditions are satisfied:
- A notice in writing of such assignment is received by the insurer
- The endorsement/instrument by which the endorsement is made or its copy, certified to be correct by both assignor and assignee or their duly authorized agents, have been delivered to the insurer
You should send the notice to the branch at which your policy is serviced.
The insurer may accept your assignment if there is an insurable interest between the assignor and the assignee. Generally, the following conditions are evaluated for assignment:
- In the interest of the policy holder
- Not against the public interest
- Not for trading
The change in rights and liabilities depends upon the type of assignment:
- Absolute assignment:
- Right of ownership of policy is transferred to the assignee
- Responsibility to pay future premiums is transferred to assignee
- Right of servicing is transferred to the assignee
- Conditional assignment: Right of ownership, responsibility to pay future premiums and right of servicing is as per the terms of the assignment
When you assign your policy, it shall automatically cancel the nomination.
Exceptions: The nomination shall not be cancelled when you assign your policy:
- To the insurer
- For taking a loan
- Against security
- On reassignment of your policy after repayment.
In these cases, the nomination will get cancelled to the extent of the interest of the insurer or assignee in the policy. The nomination will get revived on repayment of the loan.